Equity release ‘should play a larger role in retirement finances’

Posted 10/02/2010

Older people should be more willing to use equity release as a means of covering the cost of their needs during retirement, according to a trade body.

Safe Home Income Plans (Ship) has called for politicians to do more to endorse releasing equity as a potential solution to the lack of retirement finance faced by many members of Britain’s ageing population.

The body reminded consumers that around £907 billion worth of equity is currently tied up in the UK’s homes, around 40 per cent of the country’s household wealth, but that only one per cent of consumers use equity release products to access it.

Andrea Rozario, director general of Ship, therefore suggested that use of these assets can prove a helpful option that can allow older people to avoid having to leave their homes.

She said it can “help pay for a better retirement or a better standard of care in their latter years”.

Last month, the Consumer Credit Counselling Service charity called on older people to consider equity release if they wish to avoid becoming unnecessarily burdened by debt.